Philippine Standard Time - Wednesday, September 27, 2023,

PEZA ensures proper monitoring of actual investments, denies FIRB report

Wednesday, June 15, 2022

Pasay City – The Philippine Economic Zone Authority (PEZA) has denied claims stated by the Fiscal Incentives Review Board (FIRB) in its 15 June 2022 article titled, “FIRB finds PEZA clueless on actual investments made by locators who enjoy tax incentives”, citing that PEZA is not monitoring its data on actual investments by its registered business enterprises.

“PEZA is confident that benefits of incentives to investments outweigh the foregone taxes; hence, we find the statement by FIRB particularly erroneous, misleading and intends to embarrass PEZA as an Investment Promotion Agency (IPA),” stated by PEZA Director General Charito ‘Ching’ Plaza.



Monitoring and Reporting of Investments

Prior to the enactment of Republic Act No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises (CREATE Act), PEZA submits its monthly reports on Approved Foreign Investments to the Office of the Secretary-Department of Trade and Industry (DTI) and on a quarterly basis, to the Philippine Statistics Authority (PSA). This is the accepted practice for all IPAs including PEZA, to monitor the committed investments of our enterprises. The PSA posts on its website its quarterly reports on approved foreign investments based on the consolidated submission of the IPAs. When the CREATE Act took effect in April 2021, the FIRB is now included on the monthly submission of our reports.

The reports required to be submitted by our registered business enterprises under R. A. No. 10708 or The Tax Incentives Management and Transparency Act of 2015 (TIMTA) do not include a column for actual investments but is limited only on the annual tax incentives report on income-based incentives and VAT, excise tax and duty-based incentives.

The requirement to monitor the approved and actual amount of investments of the RBEs is a report imposed only under the CREATE Act under Section 205 with the filing of annual benefits report. Most of our RBES submitted already this reports to the FIRB on 15 June 2022 while PEZA has until 15 July 2022 within which to submit our reports to the FIRB. In fact, the FIRB just conducted its virtual town hall meetings with the IPAs and the RBEs in May 2022 informing us about the revised TIMTA reports which now includes annual investments.

In addition, from April 2021 to May 2022, PEZA has approved 128 projects/activities under the CREATE Act but only 18 or a mere 14% of these projects have start their commercial operations.

Accordingly, for the FIRB to state that PEZA does not monitor the inflow of actual investments is irresponsible and smacks of bad faith. #